










WHY AND WHERE 


O I L 

IS FOUND 



By J. C. YANCEY 

M C M X I X 


Copyright 1919 
J. C. Yancey 


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Why and Where 

Oil is Found 

By J. C. Yancey 

In the early days of the oil industry search for new fields 
was carried on in a haphazard way. Few or none knew exactly 
where to look for petroleum pools, and none knew why, and 
it was usually by persistent drilling of wells, and “fool’s luck” 
that prospectors, commonly referred to as wild-catters, made 
their strikes. Vastly more failures than successes resulted 
from this unmethodical procedure, and fortunes were sunk in 
testing hopelessly dry or only slightly productive territory. 

Then came science to aid the seekers of this liquid gold, and 
the geologist was called upon as counsellor and guide. The 
real prospector had admitted that he knew not “Why and 
Where.” 

Said the ancient Arab wise man, “He who knows not and 
knows that he knows not, is simple — teach him.” 

So, Man of Science who knows the story of the Dinosaur, 
who looks down the ages and beholds the battle to the death 
of Icthysaur and Plesiosaur, who reads from rocks the life 
romance of Pterodactyl, and knows how crawling reptiles got 
their feathered wings — be patient with what may seem prolix 
to you. 

Man of the six day week of business, toil and recreation, 
whose world is one of every day plain fact, to whom the Latin 
and Greek words of Geologic Science have the sound of myth 
and legend, be patient if a few strange words appear, for has 
not Science always camouflaged the simple truths of nature 


/i. /63 


1 



WHY AND WHERE OIL IS FOUOT 


with a mystic cloak of magic words familiar only to the 
initiated, the sacred, secret circle of the Professional World? 

But some have told the secrets of the Lodge, and Science 
now days walks in step with ranks of toil to do the simple 
tasks of life. 

Not twenty years ago Joseph Le Conte, in his “Elements of 
Geology,” said, “I am unable to account for the accumulation 
of oil as at Baku and Trinidad,” thus proving that at that 
time the geological world was absolutely ignorant of why oil 
accumulated in any one particular place, and they set about 
to ascertain why. 

Today the judgment and advice of the real geologist are 
indispensable prerequisites to the exploitation of any oil 
region. The geologist, the driller, the man of capital and the 
old school oil operator — at least the vast majority of them — 
now work together side by side. So, with the help that all of 
these can give, let the question be answered — “Why and 
Where is Oil Found?” 

WHY 


ioaid Dana, Father of Geologic Science, in a lecture when 
interrupted by a question from one of his students, “Young 
man. Geologic Time is long, long, LONG — DAMNED 
LONG!” Dana was a man of master intellect and profound 
learning, all-be-it deeply religious. Perhaps no words could 
better give a slight idea of the vastness of these ages than 
such words from such a man. Nature’s process is a slow one. 
She snaps her finger at time. A million years is to Her what 
a second is to us. 

Let us begin at a time when practically all of the United 
States was a granite sea floor with the sedimentary rocks yet 
to be builded in layers (strata). 

Let us look back down the dim vastness of those ages where 

2 




WHY AND WHERE OIL IS FOUND 


using years to measure time is like taking the dimensions of 
atoms to sound the distance to the stars. 

The Cambrian Time’s dim vastness had ended on the earth. 
Creation had begun. Life’s teeming myriad simplest forms 
swarmed in the Tropic Sea — the only forms of life then 
existing. The land was clothed with forest. Dense glades of 
tropic jungle shaded the moist warm ground. The crowded 
denizons of ocean changed in form and mode of life, lived 
both on shore and shoal and then chose the shore; then, 
driven by Nature’s Great Unchanging Law — the Law of 
Constant Change — moved on in changing forms and changing 
mode of life, filled the dense glades of forest with strange 
forms, grew wings and flew. The sea, the land, the air — all 
teemed and swarmed with life. 

The Paleozoic Age had come. The Carboniferous Era 
dawned on earth. Shell life, destined to contribute to the 
petroleum produced today, had never been so abundant as 
it was in earliest Carboniferous Times (known today as the 
Mississippian series of rocks). The time of COAL and OIL 
began. The curtain rose on the first act of a great drama of 
the ages. Its theme was COAL and OIL. 

Because the now famous North-Central Texas Oil Fields 
are uppermost in the minds of the public, that area will be 
used as an example in this article. 

In that day North Texas was a sea floor. The Gulf reached 
north to Hudson Bay. The great Gulf Stream flowed through 
from Tropics to the Pole, between land masses on the east 
and west. 

How may man know the story of that age? Can human 
intellect fathom the mystery of that vast dim era? Who 
lived to see and tell the tale? 

The Hand of Science points and Science speaks: “Is not 
the story written in the rocks? Are not the very stones 


3 



WHY AND WHERE OIL IS FOUND 


beneath your feet leaves in the book? Are not its characters 
and words the very forms and frames of living things that 
flourished in that day? Now turned to stone, they write the 
story in the rocks that ‘He who runs may read.’ ” 

The sea floor slowly sank and rose. The land sank and 
rose again. The sun shone warm, winds blew and rains poured 
down. The forest trees grew on the swamps and shore; their 
leaves, their trunks and branches turned to peat and then to 
coal. 

The winding rivers carried down from land to sea their 
load of sand and soil and with it remnants of earth’s life. The 
sea life lived and reproduced its kind and died in endless 
changing generations. 

Waste remnants of earth’s life came down to sea in sand 
and soil and mingled with the products of the ocean. These 
animals and plants of land and sea at death became entombed 
on the sea floor in silt and mud that changed to rock. 

The sea floor sank and deposition still went on till tier on 
tier of sand and soil built up and slowly hardened into stone, 
charged with life’s remnants from the land and sea. The 
corrals lived and built their reefs of lime. The shell life 
(mollusk) yielded up its lime to make more stone. The body 
of the mollusk mingled with life’s other remnants in the mud 
and sand that turned to rock. 

From these living things of land and sea Nature 
distilled the OIL. 

WHERE 

The sea floor rose and sank and then rose again and took 
its present form of land. 

The geologist would tell, in language understandable only 
to Men of Science, of the successive stages of submergence, 


4 




Map No. 1 

Made in 1914, showing the Burkburnett Oil Field which has since 
been proved by the drill, and other domes which are now being tested; 
also showing the Electra Oil Field and Petrolia Oil and Gas Field which 
at that time were producing. This map was prepared from data compiled 
by Yancey’s geological staff in 1913-1914. It is the only map of its 
kind in existence. The drill has proved the correctness of the theory 
at that time. 

This map shows the surface distorted, which is merely to present 
more clearly to the layman’s mind the idea of these arches and domes 
in subsurface structure. Surface high structure sometimes indicates 
subsurface high structure, though not always. For example, the Duke 
well (See Map No. 2) was drilled on surface low but structural high. 
One can plainly see that the Trinity sand feathering out at the Cosden 
gasser (see Map 2), at one time, before it was washed away, arched 
over the Duke and adjoining wells and reflected the arching of the 
structure below. 











































































































































































































































































































































































































































































































































































WHY AMD WHERE OIL IS FOUND 


emergence, deposition and erosion from Pre-Cambrian time 
down to the present; of how the Mississippian series of rocks 
were laid down, the Pennsylvanian and the Permian; of the 
overlapping and conformity of the various series of rocks; of 
their arching or folding from the unequal pressure of the 
uplifting force in the earth’s movements; of how the oldest 
exposed rocks in a given territory are of the Ordivician Age 
while the youngest are upper Cretaceous. They would tell 
of the rocks of the Devonian Age, and those classified as 
Jurassic and Triassic. They would go into detailed description 
of the color and composition of the various series of rocks 
and the conformity or non-conformity of the various strata. 
In the North Central Texas Field they would describe in 
detail what is called the Bend formation, the Smithwick 
and the Strawn (the three lower members of the Mississippian 
which is the lower member of the Carboniferous), their 
composition, etc. Since the purpose of this article is to attempt 
to bridge from the scientific to the layman’s mind the origin 
and the theory of oil and to so explain it that all can 
understand, such descriptions, so far as possible, will be 
omitted. 

These successive stages of submergence, emergence, deposi¬ 
tion and erosion have taken place throughout the whole 
range of geologic time. 

The rocks as formed were laid down in level tiers (strata) 
on the sea floor, and in the earth’s movements these tiers 
were pushed up into arches or folds through the unequal 
stress of the uplifting force. The crest of these arches are 
called domes. 

The porous rocks laid down beneath the sea were full of 
brine having an upward tendency from pressure of overlying 
strata. The oil distilled from animal and plant life of land 
and sea floated up and up on this salt water in these porous 


5 




WHY AND WHERE OIL IS FOUND 


rocks, for oil is lighter than water and oil and water 
will not mix. 

Through porous rocks of sand and lime oil kept on floating 
up, filtered into these arches till it reached non-porous rock 
through which it could not pass, and then moved on to the 
crest of the arches or the domes. There it gathered in pools 
from miles around into the highest part (the dome) of this 
arching (called anticlinal structure) where impervious cap 
rock safely sealed it in. The troughs (synclines as they are 
called) were left filled with brine and free from oil which had 
thus moved to higher levels. This accounts for the accumu¬ 
lation of oil in pools. 

Such an arch is the Ranger Field of Texas, where the oil 
is found in the two lower members of the Mississippian rocks 
at a depth of 3,250 to 4,000 feet. Such an arch is the now 
famed Duke Field in Texas, where the oil is found at from 
2,600 to 2,800 feet. Such an arch is the famous Burkburnett 
field of Texas, where the oil has broken through the arch in 
the original rocks, which cracked in their folding, and has 
migrated up from approximately 5,500 feet below and is 
found at from 1,600 to 1,800 feet. Such an arch is practically 
every field in the world. 

Sometimes the arch is plainly reflected and easily discern¬ 
ible on the surface. Sometimes so slightly shown by surface 
rocks that only a galaxy of trained geologists can, within 
any reasonable time, determine it by survey or by a series of 
shallow wells by a diamond drill. Sometimes it is so completely 
hidden by non-conforming strata that not even Science can 
determine it at the surface. 

The length and breadth of any oil field or pool, and the 
volume of oil there accumulated, is dependent mainly on the 
area of drainage. If these arches or folds in the oil-bearing 
rocks are close together then, of course, the size of the field 


6 



Map No. 2 

DUKE FIELD 
AND 

STEPHENVILLE DISTRICT 





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20 Mi 


lOMi 


DiAgrckTTv Showing 

geologic structure 

<Sc DEVELOPMENT DUKE FIELD 
AND STEPHENV/LLE DISTRICT 

1919 


Copyrighted 

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|A11 n^hti reserved. 


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+ 150 Oft 


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STEPHENVILte 


COURT HOUSE. 


+1000 ft 


Trior.ty. 






+ 500 Pt I 


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iSed Level 












500 ft 




m>kif 


1000 ft 




1500 ft 


GAS 5 hould 8 

here oil should be 


SmithwicK 


salt Water 


Walter 


(U.C-Yanceys Stephenville 
^ Slock of Leases J~ 


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WHY AND WHERE OIL ffS FOUND 


will not be as great as if these arches or folds were farther 
apart with a greater area from which the oil in the rocks 
could drain up their monoclines into the dome of the arch. 

IMPORTANCE OF GEOLOGIC SCIENCE 

The pursuit of oil in new territory, though still attended 
with risk and a degree of uncertainty, has been made, through 
the untiring efforts of the Men of Science, far less a matter of 
guesswork and chance and loss. Of course, the geologist 
cannot see all that the earth hides in its bosom, but' from his 
knowledge and study of the earth’s formation — the various 
strata — (such knowledge being acquired by actual surveys 
made and from the study of the logs of wells drilled in oil 
districts), and the surface indications he can locate what is 
termed the “structurally high’’ territory (anticlines) and the 
“structurally low’’ territory (synclines), give the general 
direction of the slopes (monoclines), and determine whether 
underlying strata on any given tract is reachable by the drill 
and may be probed with possibilities of an oil yield. 

There are two branches of the oil geologist’s work — 
surface and subsurface. The surface geologist studies the 
outcroppings of rocks (which are rocks at points where the 
granite has upheaved through these flat-lying sea rocks and 
stood them on end) to find beds of carbonaceous shales and 
limestone which may often, as they do at the Llano-Burnett 
Uplift in Llano, San Saba and Mason counties in the North 
Central Texas Fields, distill petroleum at the croppings 
(which however is mostly wasted from long exposure) and 
show a source of oil. He examines these outcroppings to 
discover sandstones or fractured limestones capped by im¬ 
pervious beds, that would form reservoirs for oil and gas. 
He also seeks for surface indications that this oil and gas has 
localized into pools away from the croppings. The subsurface 
geologist, from examination and study of these out-croppings, 

7 









WHY AND WHERE OIL IS FOUND 


estimates a safe distance from the croppings where the rocks 
should be unbroken but are pushed up gently into an arch, 
or anticlinal fold, and selects and maps the highest part of 
that fold as a suitable place to drill. 

Oil-bearing formations manifest themselves often by surface 
indications such as gas springs, oil or asphalt seepages. 
Certain type structures favor the accumulation of oil into 
pools such as anticlinal domes, and many times there can be 
most accurate forecasts of drilling results. 

Frequently these surface indications clearly reveal the 
presence of an arch, and the crest of such arch may be plainly 
discernible in the surface rocks. The underlying oil-bearing 
rocks at such point are known to be the same as in an adjoining 
producing field. The question then is “Are the sands in the 
formation below such arch porous, or have the voids between 
the grains of sand been filled with lime brought down by 
percolating waters.^ The arch is there — plain as the Dome 
on St. Peter’s Cathedral—the oil-bearing formation is there, 
proved by the drill in the adjoining field. If the sands 
beneath the oil bearing rocks are porous, this dome will be 
full of oil and salt water will be surrounding the edges of the 
dome and filling the slopes (monoclines) and synclinal troughs 
for miles around. (See Map 2 for illustration). But, if the 
sands are non-porous, the voids between the grains of sand 
filled solid with cement leached from the lime above — a 
solid block of impervious concrete — no oil will have accumu¬ 
lated and the dome will be barren structure. 

To illustrate more clearly. The now famous Duke Field in 
the Northeastern portion of Comanche county in Texas 
(See Duke Well on Map 2) is no longer in question — it has 
been proved by the drill. Today there are many wells in that 
field producing vast amounts of oil, and the largest gas wells 
of the North Central Texas Fields are found there. This 
field is located on one dome of the Duke fold or arch. The 


8 



Map No. 3 

The North-Central Texas Oil District covers an area practically 200 
miles long and 100 miles wide. The various colors shown on this map 
define the surface area of the rocks of the different ages, which are as 
readable to the geologist as words in a book. The Cisco, Canyon, and 
Strawn formations (as marked on the map) pitch in a westerly direction, ‘ 
and the Bend formation (as marked on the map) near the Granite 
Uplift pitches north and produces from an arch to the east and northeast 
of Eastland (known as the Ranger Field) at from 3,200 to 4,000 feet, 
and further north they underlie the Burkburnett Oil Field at about 
5,000 feet. The Burkburnett oil migrated up to within 1,700 feet of the 
surface from the lower rocks in which it originated. The Granite up¬ 
heaval, which was forced up through each series of sedimentary rocks 

tilting them on end, is marked in blue. ^ 

m 

The dotted lines traversing the area in a general northeasterly and 
southwesterly direction (as marked on the map) indicate the crests of 
the anticlinal folds of the district. The domes are producing oil or gas 
at their crest, and some of them are producing oil down their monoclinal 
slopes for miles each direction from the crest. This map was made a 
year ago and the development since then shows that it stands alone in 
accuracy. 




















' MAP ■ 

SHOWING MAJOk. AREAL AND STRUCTURAL GEOLOGICAL 

o /' NOR.TH CENTRAL TEXAS 

>D&Ae Map and areal geology <yfWr^ 6tafe M<:^p ,f/ UDDFN 


_ 7 ^^+++Minor flexures probably post-Cretaceous 


Axis of post-Cretaceous accentuation of pre-Pennsylvanian fold 



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rn 


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is ? 


Axis of post-Cretaceous accentuation of pre-Pennsylvanian fold 

S V 


^ 4. 4. l^linor flexures, probably post-Cretaceous 


Axis of post-Mississippian post-Pennsylvanian fold accentuation by post-Cretaceous 
movements: Principal axis of upturning of the carboniferous rocks in whole region. East 
of this fold the carboniferous rocks will be found to dip easterly 






























































WHY AND WHERE OIL IS FOUND 

drill has proved that this field extends westwardly in Coman¬ 
che county. It is no longer a question whether this pool extends 
eastwardly from the Duke well and across the line into 
Erath county, the adjoining county. The well known as the 
Phoenix well on the extreme eastern edge of the Duke pool 
(See Map 2), the great Cosden gasser just along the line of 
Erath and Comanche counties, and the three square miles of 
intervening territory, show this much practically proven oil 
and gas territory of the Duke field extending eastwardly into 
Erath county. The question then arises “Has Erath county 
another distinct and separate pool in the fold or arch found 
east of the Duke fold.^ Does an oil pool lie in the lower rocks 
which, near the Erath-Comanche county line, plunge east¬ 
ward in a monoclinal dip beneath the surface rocks of Erath 
county and rise again in an arch (anticline) in that county? 
Do the producing sands of the Ranger and Duke fields contain 
oil in the high or anticlinal structure of this second fold 
about eighteen miles farther east (See dotted line on Map 3) 
and which extends northeast and southwest through Erath 
county?” 

This great arch is plainly discernable in the surface rocks 
near Stephenville in Erath county. Its crest — the key-stone 
of the arch — is eighteen miles east from the crest of the 
arch in the great Duke field. The underlying rocks are the 
same as those of Duke and Ranger. Here we have the arch 
the same as is shown at Duke, and this Stephenville arch is 
larger than the Duke arch. The question is “Is there oil in the 
Stephenville arch? Are the sands in the Bend formation, 
which underlie this Stephenville arch, porous, or have the 
voids between the grains of sand there been filled with lime 
brought down by percolating waters? Here we have the arch, 
and the underlying oil-bearing rocks are there. If the sand 
in the underlying Bend formation is porous it should be full 
of oil — a great pool of it — with gas on top, oil on the sides 
and salt water surrounding the edges of the dome and filling 


9 






WHY AND WHERE OIL IS FOUND 


the monoclines and synclinal troughs. (See Map 2). If, on 
the other hand, the sand is non-porous, the voids between 
the grains of sand filled solid with cement from the lime 
above — a solid block of impervious concrete — no oil will 
have accumulated; the dome will be barren structure. The 
drill will tell this. Its answer is awaited with deep and vital 
interest by scores of oil operators, hundreds of land owners 
and an eagerly expectant public. Drilling wells in that 
territory are now seeking the answer. 

Thus it will be seen that it is not the province of the geologist 
to find gas and oil; it is rather his province to locate the 
structure and to keep his clients as far away as possible from 
places where there is little or no chance of finding them. On 
the dome is always the place to drill. The syncline never can 
yield oil, unless, perchance, there is no water in the structure 
which is a most rare condition. The syncline will be full of 
salt water and the oil will have floated on the water up to the 
higher places — to the domes. 

When the first well in a district strikes oil, then the real 
expert — one who has studied and knows conditions 
obtaining there — can readily tell in what direction the field 
should extend and how far from the producing well in each 
direction it is safe to drill. 

SHALLOW OIL POOLS 

When these arches and domes, disclosed by surface indica¬ 
tions or otherwise, have been located, there is always a chance 
that the lower strata from which the oil originated, cracked in 
its folding (See Map 4), in which event some or all of the oil 
accumulated in that dome of the arch in that strata, broke 
through and migrated to upper beds of non-porous rocks and 
thence to the arches and domes of that strata. Then, of 
course, the oil would be found at a shallower depth. This 
explains why oil is often found at a shallow depth in fields 

10 


I 




WHY AND WHERE OIL IS FOUND 


where it is known the oil originated in rocks often thousands 
of feet below where it is found. This same condition may 
obtain in territory regarded as impossible to reach with the 
drill the rocks in which the oil originated, owing to the depth. 
The chances are about one time in a hundred that the rocks 
or limes holding the oil in its original sands cracked in their 
folding or arching and the oil there accumulated thus escaped 
and migrated to these upper beds. 

Again, shallow oil pools are found as the result of what 
is known as “Faulting”— where the earth’s strata, through 
pressure, break and their edges slip, one edge with an upward 
tendency and the other downward (See illustration on Map 4) 
In this Faulting often all or some of the oil of the oil-bearing 
strata will break through and rise, or migrate to upper im¬ 
pervious strata and thence to the arches and domes of that 
strata, as in the case of the cracking of strata in folding. 

The drill in test wells often finds at a shallow depth what 
they call a “new sand,” which is nothing more than the 
migration of the oil from its original rocks to these upper 
beds or strata. 

Why take chances and drill territory like that in the hope 
that the oil has broken through, from some cause, and mi¬ 
grated up when there is so much undrilled territory where 
the oil-bearing rocks can be reached by the drill, such as the 
extensions of the Ranger field, the Duke field, and many 
other points in Texas which have not as yet been tested by 
the drill. Then, if the oil has broken through it can be found 
at a lesser depth, and if not it can be found where it belongs. 

MAGNI TUDE OF NORTH TEXAS DISTRICT 

A great arch of Mississippian rocks, tilted up by the granite 
uplift of Llano, San Saba and Mason counties of Texas, 
plunging north 200 miles to the Red River and traversed from 


11 




WHY AND WHERE OIL IS FOUND 


end to end by small paralleling arches or folds on its slopes 
and crest, (as shown in Map 3), is the North-Central Texas 
oil district. There is no other known district showing an arch 
of Mississippian rocks (the rocks from which it is now estab¬ 
lished the oils of the district originated) the magnitude of 
this one, with one slope or monocline pitching to the Balcones 
Fault on the southeast and the other slope or monocline 
pitching to the staked plains of the Panhandle on the North¬ 
west. It is unquestionably the largest discernible arch of 
oil-bearing rocks in the world yet discovered, and has drained 
up its vast monoclinal slopes an abundance of oil that will 
yet startle the world, which oil has naturally floated on water 
up into the domes of the many major folds that traverse this 
majestic arch from end to end. 

The area eomprising the North-Central Texas 
district is practically 200 miles long by 100 miles wide, 
yet not more than two per cent, of this vast area can 
possibly produce oil. Knowing this, the mystery to 
me is that capital, under the flush of excitement, 
has bought and paid good money for leases covering 
practically the entire district when 98 per cent, of it 
must inevitably prove non-productive. 

In the great Pennsylvania district less than two-tenths of 

one per cent, of the oil area is productive. More than half 

of Wyoming’s production is within a space of six square 

miles. The noted Tepetate-Casiano pool in Mexico, which 

has produced 75,000,000 barrels of oil in eight years, is only 

one mile wide and four miles long. 

» 

MINOR FOLDS OR ^^WARTS’’ MISLEADING 

On the crest of this great arch and between the major 
folds there are sure to be slight folds, or what one might call 
“warts” in comparison of their importance with the larger 

12 


( 




WHY AND WHERE OIL IS FOUND 


folds. Promiscuous prospectors are certain to drill into these 
“warts” and get a temporary flow of oil and gas. Then the 
unsophisticated ones will buzz around and pay fabulous 
prices for leases in that vicinity and the “old-time” oil man — 
the one who has always reckoned without science — will 
immediately begin to prove that geologists were wrong in 
condemning that particular territory. 

HOW THE OIL GAME IS PLAYED 

North Central Texas has a thousand wells now drilling in 
proven and prospective fields. The scope of the productive 
areas is still untested by the drill. 

The oil promoter came, of course, along with the developer and 

producer, and played his game, the ONE SURE THING IN 
OIL; sure of its results both for promoter and investor — 
these SURE results are known. Discussion of his enterprise 
will be passed by to tell “HOW THE GAME IS PLAYED 
BY OIL MEN — developers and producers of oil. 

The Prospector and Developer 

Leases are obtained and the land owner receives one-eighth 
of the oil produced — his “Royalty.” That is his share 
established by custom and experience. If his land is in a 
proven field his lease is worth a bonus — thousands of dollars 
per acre if close up to good wells, but close up means 
close up. 

If the land is some distance from a proven field it is still 
worth money, if on good “structure,” and still more if the 
“structure is being tested by the drill. If not on “structure” 
it is worthless even though it may be fairly near production. 
If not on “structure” it is worthless, absolutely so, notwith¬ 
standing the fact it may sell for real money to someone who 
knows no better than to buy it — and there are many such. 


13 




WHY AND WHERE OIL IS FOUND 


The operator takes the lease and drills the wells, produces 
at his own expense and pays the land owner his one-eighth 
royalty. Often the operator sells interests in his enterprise 
to one or many others, sharing expense and profits. Some¬ 
times he incorporates. 

When testing a new field if the operator is wise he takes 
his leases on a “structure,” “dome” or “arch” and verifies 
his location by the best science, money and judgment can 
command. If he is rash, or still believes (as some men do) 
that oil may be found anywhere, he gets his leases where he 
can and starts the drill at random. 

If well supplied with patience, nerve and cash, the operator, 
having found his “structure,” “dome” or “arch” as it may be 
termed, leases the whole “structure” if he can — 10,000 
acres or more perhaps — so that he will control a field if he 
discovers oil. 

When he has leased his land and put aside the capital to 
drill the well, he finds that he is staking a fortune on the 
prospect of finding oil. The cost and expense of getting 10,000 
acres of leases on “structure” fairly near a proven field and 
drilling a well 3,000 to 4,000 feet will run into over a hundred 
thousand dollars. This is a venture of some magnitude even 
for big capital, however good the structure. The operator 
does not hope to “own the earth;” he has other ventures and 
investments. He wants to “hedge” instead of carrying alone 
the burden of his venture. Others join him and take interests 
in the well. Other operators, individuals and the Producing 
Companies buy leases from him in his block around the well. 

If his well gets oil a new pool is discovered and opened up, 
and it is here that the greatest profits are made in oil. Where 
the risk runs highest profits naturally run highest. Lease 
values will then run to a hundred times their cost. 

Those who hold interests in the well are invariably old 
business associates and have their settled policy for handling 

14 


I 



WHY AND WHERE OIL IS FOUND 


oil, have backed the project and will see it through whether 
he sells a lease or not. 

He who buys a lease has it in his own control to sell or 
operate at will. No controlling interest can dictate a policy 
or say what profit the minority shall take. No promoter’s 
organizing expense and profit need be paid. No corporation 
law hampers his business. He has bought the lease and it 
is his. The money he has paid goes mainly to help drill the 
well to test the district and to prove the value of his lease. 

If oil is found he may cash in and take his profit by selling 
at the enormous price leases bring in proven fields, or he 
himself can operate or get his lease developed by oil men, 
he still retaining for himself the lion’s share. 

If he has bought “royalty” from the land owner he owns 
what oil men term the “Gold Bond” of the business. He takes 
his share of all the oil produced and the operator has all the 
trouble, worry and expense of producing the oil. 

If the well drilled proves a dry hole and the territory is 
thus condemned, he has lost his money on a chance to win. 

He has had a square deal, for no one has been in a position 
to take advantage or defraud. He has played the game the 
oil man’s way. He has had a run for his money — win or 
lose — and has done his part to help supply the Nation’s 
need of oil. 

That is “How the Game is Played” in the exploitation and 
development of new fields. 

The Producers Game 

There is another branch of the oil business, and a vastly 
more conservative branch — one in which fortunes are made, 
though not so fabulous as in the exploitation and develop- ^ 
ment of new fields, since with the elimination of risk profits 


15 







WHY AND WHERE 


IS FOUIND 


are proportionately reduced. This branch is the purchase 
of production in proven fields. This, however, is the realm 
of organized large capital and the Producing and Refining 
Companies of large capital, and is quite beyond the reach of the 
man of small capital, since prices are enormous. Here the 
expert is needed to conserve the interests of the purchasers, 
to determine whether the production is near salt-water or 
high up on the structure, and through the expert the value 
of the production is fixed. 

The man of small capital desiring to make investments in 
oil, will ask “Is there no way in which I may invest my money 
in a safe and conservative manner.?” Yes. The man of small 
capital has no better and more profitable means of making 
money — big money — than to interest his business associates 
and friends with capital in pooling their money — forming a 
syndicate — thus having at all times a large amount of money 
available to take advantage of the many opportunities offered 
in leases close to production in a proven field. When the first 
well strikes the oil sands in any new district, there is a period 
of several days in which opportunities are presented for 
buying at nominal prices — indeed at bargains — leases close 
up to the well. With a sufficient amount of cash on hand to 
take advantage of these bargains, large profits can be earned 
by the members of the syndicate, in which they share pro¬ 
portionately. 

In order to safe-guard the interests of these investors such 
leases must be carefully selected by an expert. To pay big 
money for a lease in the wrong direction from a producing 
well, and off the structure, means not only the loss of the 
money paid for such lease but also the loss of the profits that 
would have been made from the investments where leases are 
carefully selected. The well opening up any new district may 
be on what is called the rim — the edge — of the pool under- 
, lying the district on one side or the other, and the location of 
the oil pool from the well means everything to the lease 

16 


I 



.WHY AND WHEKE OIL IS FOUND 


buyer. Here again is the function of the expert, for only the 
expert can determine and define the extent and direction of 
the pool and tell just how far away from the well in each 
direction it is safe to purchase a lease — one of value — or 
to drill a well. 


Promoter’s Game 

In the organization and promotion of oil companies, which 
have not had proper guidance in the selection of their leases, 
the greatest abuses of the rights of the investor are found. 
It is a well known fact that great numbers of the oil companies 
organized and promoted — and whose organizers, officers 
and directors are unquestionable so far as financial and 
business reputation is concerned, — prove failures and a 
consequent loss to the purchasers of their stocks. In fact 
there have been so many of these failures and so great has 
been the loss to investors, that the man with any capital to 
invest has almost lost faith in the purchase of oil stocks. 
These failures are attributable to various causes, but the 
most frequent cause is that the company was organized and 
its capital stock, or at least a very large part of it, was paid in 
by the transfer of its lease holdings put in at inflated prices, 
and the whole scheme is promoted on leases selected at 
random without regard to location or underlying structure, 
and from which there never was a chance to produce a barrel 
of oil. 

No business can be greater than its management, and no 
oil company’s value can possibly be greater than the value of 
its lease-holdings. 

The leases of these oil companies in most instances have 
been bought up by some one who knew nothing of the oil 
business, but who went out when the oil excitement started 
in some portion of the State and bought leases from land 
owners wherever he could, without having any knowledge 


17 




WHY AND WHERE OIL IS FOUND 


whatever of either the surface or underlying structure of the 
lands or the possibilities of an oil yield therefrom. 

Take the State of Texas, for example, where the oil ex¬ 
citement is now most rife: Because there is oil under some 
portions of the state does not at all indicate that there is oil 
to be found under every portion of it. The state of Texas is 
large — larger than the whole of Germany. To say that a 
lease is in Texas, or even in the North Central Texas District, 
does not at all signify that it is in the oil yielding area. Again 
I say that not two per cent of the vast area comprising 
the North-Central Texas District can possibly produce 
oil. 

These oil companies when organized sell their stock to the 
investing public — usually to men with small capital to invest 
— through glaring advertisements and smooth-talking un¬ 
scrupulous salesmen, and with the money thus obtained 
they drill their weU or wells on their leases, which wells are 
inevitably dry holes. Then they are broke, and the purchasers 
of the stock have paid the expense of the venture and are the 
losers — losers not only of the capital invested but likewise 
of the profits that would and could have been realized on the 
investment had the leases of the company been carefully and 
properly selected by an expert in a proven field or even 
possible territory. Had the leases been properly selected such 
company could and would have made money for the 
organizers and promoters of it and paid handsome dividends 
to the stock-holders. 

There are many such companies today offering their stock 
for sale to the public, and it behooves the investor to know 
and not guess about them before placing his money. There 
are just as many conservative companies — companies who 
have in all good faith and conscience gone out and paid their 
money for expert advice in the selection of their holdings on 
which to drill; the very best science and skill money could 

18 


f 



WHY AND WHERE OIL IS FOUND* 


command — whose holdings are within well defined oil- 
producing areas and worth good money whether they drill 
their wells or sublease to some producing company who will 
drill for them. The purchasers of their stock have bought an 
interest in something of value. 

For one having actual knowledge of the oil areas of any 
field, it is an easy matter to readily determine the value of 
the stock or properties of any company. All that is required 
to determine this is a statement of the capitalization and a 
description of the holdings of the company. 

DEMAND FOR DEVELOPMENT 

jF ew persons realize what unceasing effort is necessary 
to secure a sufficient supply of crude oil in this country. The 
decrease of oil production and the rapid increase of demand 
compel the expenditure of large sums in prospecting new 
territory. 

In 1917 the world approached its crisis. The war was on. 
America had been asleep but awoke to find the World’s fate 
in Her hands. 

The Allies’ Battle Fleets burned oil. The battle tanks, 
the cannon’s motor lorries, the ammunition trucks, the Red 
Cross vans, the war craft of the air, the cars for officers and 
men, the million cars and trucks behind the lines in France, 
in Belgium, in England and America, burned fuel made from 
oil. 

It was the Age of Oil. Oil or its lack might mean a victory 
or defeat. Oil would be one great factor when it came to 
Terms of Peace. 

The Hun controlled Roumania’s ruined fields. Baku was 
held by the Bolshevik, whose master was the Kaiser. The 
wiley German agent connived and schemed in Mexico to 
stop the flow of oil. 


19 






WHY AND WHERE OIL IS FOUND 


Development in the new fields of Persia stopped. Shipping 
was short and Burma’s output was diminished. Samatra 
and Borneo were far away and their production declining. 
Japan’s small fields could not supply the home demand. 
China as an oil proposition had proved a failure. 

In Central and South America no important fields had been 
developed. 

In Oklahoma, Cushing field was on the rapid decline and 
the other fields were scarcely holding their own. Production 
in Kansas had reached its zenith and was falling off. The 
fields of fuel oil in Southern Texas showed no substantial 
increase. 

In California and Wyoming the important oil deposits were 
set aside for future generations under the plea of Conserva¬ 
tion. Development in many districts stopped, pending the 
outcome of Government litigation. Consumption far outran 
production. Supplies of oil were falling off throughout the 
world. The question loomed “WHAT SHALL WE DO 
FOR OlLr 

Efforts were made to win over the Bolshevik; the Nations 
begged Carranza to be good; the older fields of the Mid- 
Continent were redrilled and every promising structure 
tested. 

In Wyoming and California development on private lands 
was pushed to the utmost. Oil men went to Washington and 
urged the opening of the Western Oil Reserves, but Conser¬ 
vation held its own. Washington recommended the distilla¬ 
tion of shale, but the process was costly and difficult, and 
the yield small in comparison. 

A few tests of the Mississippian (the formation underlying 
the Pennsylvanian measures of Kansas and Oklahoma) had 
proved futile. Theoretical geologists looked sad and said 
“No oil is in or under the Mississippi Lime in Texas.” 


20 



WHY AND WHERE OIL IS FOUND 


In North Texas a few small pools were found in Pennsyl¬ 
vanian rocks. What tests had reached the Mississippi Lime 
(reached but not probed) without finding oil were pronounced 
failures and abandoned. 

But suveys by trained geologists (of my staff operating in, 
Texas in 1913-1914) three years before had found the Missis¬ 
sippi Lime outcropping near the Granite Uplift in Mason 
and San Saba counties charged with oil at the surface. 

The strata of the Mississippian, termed the Bend, sloped 
to the north beneath the overlying Pennsylvanian rocks 
which plunged off at right angles to the west. 

Their verdict was that the Mississippian rocks, till then 
pronounced barren, would prove, as they have since so 
bountifully done, to be the source of oil in Texas as in the 
states of Pennsylvania, West Virginia, Kentucky, Illinois, 
Kansas and Oklahoma. 

Their conclusions were verified. Discovery of oil in these 
Mississippian rocks in fabulously rich pools startled the 
World. The North Central Texas District has become the 
greatest oil area on earth today. 

The World Crisis was met. Never was necessity of a 
nation — or in truth a great world need — more bountifully 
supplied at a more crucial time, and with such a magnificent 
productl — A high-grade refining oil equal in every way to 
the Pennsylvania crude, the world’s finest. 

The world was ready for the discovery. Oil men from every 
field came in. 

SELECTION OF LAND MOST VITAL 

There are thousands of oil producers in the United States, 
and many are today operating in the North-Central Texas 
District. In view of the keen competition for land and the 


21 






WHY AND WHERE OIL IS FOUND 


increasing cost of drilling, careful selection of oil-land holdings 
is most vital. The Geologist, therefore, cannot safely be 
ignored. In Oklahoma, for example, geological investigations 
are credited with bringing in many new pools, and the pro¬ 
portion of dry holes on territory recommended by geologists 
is less than one third as great as before the scientists took a 
hand in the game. 

The most nauseating thing in the world to me is the “old 
time” or the “new time” oil man who took a lease in a district 
because some real gambler or man of exceptional brain 
power figured it out as the right place to drill a test well, 
and this “old time” or “new time” oil man eventually strikes 
oil on his lease — through “fool’s luck” he had chosen the 
right direction from the producing well, he knew not why — 
He immediately buys a diamond as big as the sun in compari¬ 
son with his brain, announces himself as an OIL EXPERT 
and recommends the drilling of test wells in a new district, 
his arguments for the district being none other than that it 
looks good to him; that he has been in the oil business many 
years, or that he is a producer of oil and naturally knows all 
about it. With this line of argument he creates an atmosphere 
the layman is unable to penetrate and innocent people, 
solely on their confidence in him, invest and lose their all. 
In this he is guilty of two moral crimes. He has caused in¬ 
nocent people to invest and lose their all, and has destroyed 
their faith in the legitimate oil business. 

I 

All men who pose as geologists are not geologists. Geologists 
are just as human as the men of the legal and medical pro¬ 
fessions, and there are just as many inferior ones among them 
as every one knows there are in the other professions, and it 
behooves the business man to handle them and get from each 
one the thing of value he really has to deliver. In other words, 
penetrate his pose, as all professional men with whom I have 
had experience, pose to the layman. 


22 



WHY AND WHERE OIL IS FOUND 


I wish to say here, as I have said many times in the public 
press, I am not a geologist. I have, however, studied the 
subject of geology for many years, and have mixed socially, 
in business and in physical combat, have discussed the subject 
of geology many many nights around the camp fire, and slept 
on the ground for weeks at a time with some of the most 
eminent geologists of the world, and from my experience with 
them I know whom to employ from among the profession, how 
long to employ each one at a particular kind of work for 
which he is best adapted; I know where to look for their 
mistakes and how to check them up. 

I have paid the price, by not coming into my own, of many 
millions through errors of geologists in turning down good oil 
land and in recommending lands from which there was not a 
chance to produce oil. I have since learned, in my years of 
experience, that many of those mistakes could easily have 
been avoided had I had my geologists work with me instead 
of for me trying to run my business their way. 

I am not trying to leave the impression that I know all 
about the oil business, because it is a vast subject — too vast 
for one human mind to fathom. I have had years of experience 
in the oil business, and in many fields. I have made many 
mistakes that caused me years of sorrow and worry. I am 
merely trying to protect, as far as possible, the investing 
public from making those same mistakes, as it is not likely 
that one of ordinary intelligence will make the same mistakes 
over and over again. 

With my experience, I do not believe one will ever be able 
to accuse me of reckoning without Science in the oil business, 
or drilling into a “wart” for oil, which is the destiny of so 
many men in the business at this time whose conceit will not 
allow them to be told anything new. 

July IsU 1919. 


23 





Anticlinal Fold, Chesapeake and Ohio Canal, near Hancock, West Virginia 

(Kroiiu Photograph) 


Above plate from THE NEW INTERNATIONAL ENCYCLOPAEDIA 

Dodd, Mead &i Company, Publishers 



























